No room to reduce housing prices: CREDAI

Aug 22, 2015

Source : Toi

NEW DELHI: A day after RBI governor Raghuram Rajan advised builders stuck with unsold inventories to cut rates, realtors' body CREDAI on Friday said there is no scope to reduce housing prices and demanded that interest rates on home loans as well as taxes should be reduced to boost demand.

"While we respect the RBI governor's concern over kick starting the real estate sector, it would be prudent to say that from the developers side that a substantial reduction in prices has already happened across the country," CREDAI president Getamber Anand told PTI.

"Any further decrease in sale prices would mean an out of pocket expense for the developers thereby acting as the last nail in the coffin of an industry which contributes so much to the economy and employment at large," he added.

Anand said housing prices have gone down by 15-20 per cent on an average in last two years across India, while input costs have risen by 15-20 per cent.

The Confederation of Real Estate Developers' Associations of India (CREDAI), which has about 10,000 realty developers as members, sought that government should rationalise taxes and circle rates while interest rates on home loans should be cut.

"It is now largely up to the state to rationalise taxes, ready reckoner rates and streamline the approval process to bring down property prices and provide relief to the end user. A rate cut in home loans is the need of the hour to relive the home buyer of the huge burden of mounting EMIs," Anand said.

Real estate sector, particularly residential segment, is facing a huge slowdown for last 2-3 years, resulting in significant delays of up to 6 years in completion of projects.

The CREDAI president added that the industry, on its part, is eager to focus on execution and supply of good quality housing stocks to enable the governments ambition of 'Housing for All' by 2022.

Yesterday, Reserve Bank Governor Raghuram Rajan exhorted realty developers stuck with high inventories to cut their rates even as the country's largest lender SBI sought RBI's nod for cutting home loan rates.

"I do believe that if real estate developers who are sitting on unsold stocks bring down prices, that will be a very great help to the sector because once there is a sense that prices have stabilised, more people will be willing to buy," Rajan had said at the second SBI Economics and Banking Conference held in Mumbai.

According to a report by property consultant Knight Frank India, over 7 lakh housing units remain unsold in eight major cities and it will take more than three years to exhaust the inventories.

The National Capital Region (NCR) market alone had 1.9 lakh unsold homes as of June.

Latest Realty News

Panaji: Pointing out that the government collected approximately 216 crore as infrastructure tax from 2009 to 2015, CREDAI - Goa questioned the government's lack of interest in providing necessary infrastructure
like road, water, sewerage and electricity connections to housing and commercial projects. The real estate developer's body also urged the government to implement Regional Plan 2021 in order to avoid confusion in the minds of consumers and real estate developers.

Mumbai: Piling inventory levels of real estate players in the country on Thursday brought the controversial 'teaser loans' back into focus, with State Bank of India asking the Reserve Bank of India to allow lenders to sell loans below the base rates.

DEHRADUN: An estimated 1,500 hectares of prime land housing tea gardens - many of which were planted by the British in the city - is lying neglected with the tea plantations there barely able to produce tea of substantial quantity.

BELAGAVI: Belagavi unit of confederation of real estate developers association of India (CREDAI) will be hosting 'Statecon-2015', an annual state level convention of CREDAI, Karnataka this time in city on September 2nd and 3rd. Union urban development minister Venkaiah Naidu will inaugurate the event.

New Delhi: Over 55,000 home buyers will now get possession of their flats in Noida as the government issued the final notification demarcating the Eco Sensitive Zone (ESZ) around Okhla bird sanctuary, realtors' apex body CREDAI said on Wednesday.

New Delhi: Average apartment sizes fell by up to 26 per cent in last five years across seven major cities in the country as developers are making smaller flats to boost their sales in a sluggish housing market, according to global property consultant JLL India.

NEW DELHI: As many as 55,000 home buyers will benefit immediately from the government's move to reduce the area of the eco-sensitive zone around the Okhla Bird Sanctuary here, leading real estate developers said.

NOIDA: The final announcement on he bounds of the eco-sensitive zone around Okhla Bird Sanctuary by Union minister Prakash Javadekar is likely to put smiles back on the faces of Noida flatbuyers and builders alike. The legal impasse, which had crippled the real estate bazaar for two years, had even paralysed homebuyers from moving into ready flats.